UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, ~~2021~~2022

☐Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

Commission file number 001-33404

WESTWATER RESOURCES, INC.

(Exact Name of Registrant as Specified in Its Charter)

Delaware		75-2212772
(State of Incorporation)		(I.R.S. Employer Identification No.)

6950 S. Potomac Street, Suite 300, Centennial, Colorado 80112

(Address of Principal Executive Offices, Including Zip Code)

(303) 531-0516

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
Common Stock, $0.001 par value		WWR		NYSE American

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated Filer ☐		Accelerated Filer ☐

Non-accelerated Filer ☒		Smaller reporting company ☒

		Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Title of Each Class of Common Stock		Number of Shares Outstanding
Common Stock, $0.001 par value		~~35,273,263~~48,066,682 as of November ~~10, 2021~~9, 2022

Table of Contents

WESTWATER RESOURCES, INC.

TABLE OF CONTENTS



DEFINITIONS	3

PART I — FINANCIAL INFORMATION	35

ITEM 1. FINANCIAL STATEMENTS	35

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	1917

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	2622

ITEM 4. CONTROLS AND PROCEDURES	2622

PART II - OTHER INFORMATION	2723

ITEM 1. LEGAL PROCEEDINGS	2723

ITEM 1A. RISK FACTORS	2823

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	2824

ITEM 3. DEFAULTS UPON SENIOR SECURITIES	2824

ITEM 4. MINE SAFETY DISCLOSURES	2824

ITEM 5. OTHER INFORMATION	2824

ITEM 6. EXHIBITS	2825

SIGNATURES	2926

Table of Contents

DEFINITIONS

When used in this Form 10-Q, the following terms have the meaning indicated.


Term	Meaning
Alabama Graphite	Alabama Graphite Company, Inc., an Alabama corporation and wholly owned subsidiary of Westwater Resources.
Annual Report	Westwater Resources, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2021.
AGP	Alabama Graphite Products, LLC, an Alabama limited liability company and wholly owned subsidiary of Westwater Resources.
ASC	FASB Accounting Standards Codification.
ASU	FASB Accounting Standards Update.
ATM Offering Agreement	Controlled Equity Offering Sale Agreement between Westwater Resources and Cantor Fitzgerald & Co. dated April 14, 2017.
Cantor	Cantor Fitzgerald & Co.
Coosa Graphite Deposit	The Company’s graphite mineral deposit located near Rockford, Alabama.
EU Critical Raw Minerals List	The list of raw materials that are crucial to the economy of the European Union published by the European Commission.
Inducement Plan	The Employment Inducement Incentive Award Plan. The Inducement Plan provides for the grant of equity-based awards, including restricted stock units, restricted stock, performance shares and performance units, and its terms are substantially similar to the Company’s 2013 Omnibus Incentive Plan.
Kellyton Graphite Plant	The Company’s planned battery-grade graphite processing facility near Kellyton, Alabama.
FASB	The Financial Accounting Standards Board.
graphite	A naturally occurring carbon material with electrical properties that enhance the performance of electrical storage batteries, listed on the U.S. Critical Minerals List and the EU Critical Raw Materials List.
Gross acres	Total acreage of land under which we have mineral rights. May include unleased fractional ownership.
Lincoln Park	Lincoln Park Capital Fund, LLC.
U.S. Critical Minerals List	The list of critical minerals that are crucial to the economy of the United States of America published by the Department of Interior.
vanadium	A rare-earth metal used as a strengthening alloy in steelmaking, and in certain types of batteries, listed on the U.S. Critical Minerals List.
Westwater Resources	Westwater Resources, Inc.
2020 Lincoln Park PA	Purchase Agreement dated as of December 4, 2020 between Westwater Resources and Lincoln Park Capital Fund, LLC.

USE OF NAMES

In this Quarterly Report on Form 10-Q, unless the context otherwise requires, the terms “we,” “us,” “our,” “WWR,” “Westwater,” “Westwater Resources,” or the “Company” refer to Westwater Resources, Inc. and its subsidiaries.

Table of Contents

CURRENCY

The accounts of the Company are maintained in U.S. dollars. All dollar amounts referenced in this Quarterly Report on Form 10-Q and the consolidated financial statements are stated in U.S. dollars.

Table of Contents

PART I — FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

WESTWATER RESOURCES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(expressed in thousands of dollars, except share amounts)

(unaudited)


	September 30,		December 31,		September 30,		December 31,
	2021		2020		2022		2021
ASSETS

Current Assets:
Cash and cash equivalents	$	118,969	$	50,315	$	100,308	$	115,293
Equity securities		3,438		1,520
Prepaid and other current assets		366		754		516		320
Total Current Assets		122,773		52,589		100,824		115,613

Property, plant and equipment, at cost:
Property, plant and equipment		10,577		9,080		64,472		14,593
Less accumulated depreciation and depletion		(97)		(95)
Less: Accumulated depreciation						(213)		(114)
Net property, plant and equipment		10,480		8,985		64,259		14,479
Operating lease right-of-use assets		258		353		122		226
Restricted cash		—		10
Other long-term assets		245		—		—		2,665
Total Assets	$	133,756	$	61,937	$	165,205	$	132,983

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current Liabilities:
Accounts payable	$	3,002	$	1,734	$	18,521	$	3,043
Accrued liabilities		2,792		2,369		2,122		2,129
Operating lease liability - current		151		149
Operating lease liability, current						128		152
Total Current Liabilities		5,945		4,252		20,771		5,324

Operating lease liability, net of current		117		214		—		83
Other long-term liabilities		1,352		—		1,378		1,378
Total Liabilities		7,414		4,466		22,149		6,785

Commitments and Contingencies (see note 10)
Commitments and Contingencies (see note 8)

Stockholders’ Equity:
Common stock, 100,000,000 shares authorized, $.001 par value;
Issued shares - 34,636,224 and 19,172,020 respectively
Outstanding shares - 34,636,063 and 19,171,859 respectively		34		19
Common stock, 100,000,000 shares authorized, $.001 par value
Issued shares - 48,066,843 and 35,279,724, respectively
Outstanding shares - 48,066,682 and 35,279,563, respectively						48		35
Paid-in capital		466,017		383,723		494,840		468,578
Accumulated deficit		(339,451)		(326,013)		(351,574)		(342,157)
Less: Treasury stock (161 shares), at cost		(258)		(258)		(258)		(258)
Total Stockholders’ Equity		126,342		57,471		143,056		126,198

Total Liabilities and Stockholders’ Equity	$	133,756	$	61,937	$	165,205	$	132,983

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of Contents

WESTWATER RESOURCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(expressed in thousands of dollars, except share and per share amounts)

(unaudited)


	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,				For the Three Months Ended				For the Nine Months Ended
	2021		2020		2021		2020		September 30,				September 30,
									2022		2021		2022		2021
Operating Expenses:
Product development expenses	$	(1,834)	$	(1,641)	$	(5,766)	$	(1,942)	$	(257)	$	(1,834)	$	(857)	$	(5,766)
Exploration expenses		(348)		—		(877)		—		(235)		(348)		(644)		(877)
General and administrative expenses		(2,189)		(1,536)		(6,470)		(4,106)		(2,611)		(2,189)		(7,466)		(6,470)
Arbitration costs		(644)		(171)		(2,190)		(868)		—		(644)		(142)		(2,190)
Mineral property expenses		(94)		(12)		(94)		(18)		(11)		(94)		(18)		(94)
Depreciation and amortization		(1)		19		(3)		(5)		(43)		(1)		(99)		(3)
Total operating expenses		(5,110)		(3,341)		(15,400)		(6,939)		(3,157)		(5,110)		(9,226)		(15,400)

Non-Operating Income/(Expenses):
Unrealized investment gain		507		—		1,918		—
Other income (expense)		35		(21)		44		7
Total other income (expense)		542		(21)		1,962		7

Net Loss from continuing operations		(4,568)		(3,362)		(13,438)		(6,932)

Net Loss from discontinued operations		—		(6,389)		—		(8,573)
Non-Operating Income:
Unrealized gain on equity securities										—		507		—		1,918
Other (expense) income, net										(296)		35		(191)		44
Total other (expense) income										(296)		542		(191)		1,962

Net Loss	$	(4,568)	$	(9,751)	$	(13,438)	$	(15,505)	$	(3,453)	$	(4,568)	$	(9,417)	$	(13,438)

BASIC AND DILUTED LOSS PER SHARE									$	(0.07)	$	(0.13)	$	(0.21)	$	(0.42)
LOSS PER SHARE FROM CONTINUING OPERATIONS	$	(0.13)	$	(0.42)	$	(0.42)	$	(1.18)

LOSS PER SHARE FROM DISCONTINUED OPERATIONS	$	—	$	(0.81)	$	—	$	(1.45)

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING		34,331,778		7,904,522		31,808,215		5,905,850		47,462,656		34,331,778		43,807,123		31,808,215

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of Contents

WESTWATER RESOURCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(expressed in thousands of dollars)

(unaudited)


	For the Nine Months Ended September 30,				For the Nine Months Ended September 30,
	2021		2020		2022		2021
Operating Activities:
Net loss	$	(13,438)	$	(15,505)	$	(9,417)	$	(13,438)
Reconciliation of net loss to cash used in operations:
Non-cash lease expense		(1)		2		(3)		(1)
Accretion of asset retirement obligations		—		170
Costs incurred for restoration and reclamation activities		—		(501)
Depreciation and amortization		3		41		99		3
Stock compensation expense		594		170		703		594
Unrealized (gain) on equity securities		(1,918)		—
Impairment of uranium properties		—		5,200
Unrealized gain on equity securities						—		(1,918)
Effect of changes in operating working capital items:
Decrease/(Increase) in prepaids and other assets		55		(29)
Increase/(Decrease) in payables and accrued liabilities		1,665		318
(Increase) decrease in prepaids and other assets						(196)		55
Increase in payables and accrued liabilities						225		1,665
Net Cash Used In Operating Activities		(13,040)		(10,134)		(8,589)		(13,040)

Cash Flows From Investing Activities:
Proceeds from PPP loan escrow		333		—		—		333
Building deposit		(245)		—		—		(245)
Capital expenditures		(119)		(107)		(31,968)		(119)
Net Cash Used In Investing Activities		(31)		(107)		(31,968)		(31)

Cash Flows From Financing Activities:
Proceeds from note payable		—		331
Issuance of common stock, net		81,865		13,530		25,604		81,865
Payment of minimum withholding taxes on net share settlements of equity awards		(150)		—		(32)		(150)
Net Cash Provided By Financing Activities		81,715		13,861		25,572		81,715

Net increase in Cash, Cash Equivalents and Restricted Cash		68,644		3,620
Net (decrease) increase in Cash, Cash Equivalents and Restricted Cash						(14,985)		68,644
Cash, Cash Equivalents and Restricted Cash, Beginning of Period		50,325		5,667		115,293		50,325
Cash, Cash Equivalents and Restricted Cash, End of Period	$	118,969	$	9,287	$	100,308	$	118,969

Supplemental Non-Cash Information with Respect to Investing and Financing Activities:
Accrued capital expenditures (at end of period)						16,028		—
Total Non-Cash Investing and Financing Activities for the Period					$	16,028	$	—

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of Contents

WESTWATER RESOURCES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(expressed in thousands of dollars, except share amounts)

(unaudited)

Common Stock

Paid-In

Accumulated

Treasury

Nine months ended September 30, 2021

Shares

Amount

Capital

Deficit

Stock

Total
Balances, January 1, 2021

19,172,020

$
19

$
383,723

$
(326,013)

$
(258)

$
57,471
Net loss

—

—

—

(13,438)

—

(13,438)
Common stock issued, net of issuance costs

15,407,018

15

81,850

—

—

81,865
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes

57,186

—

594

—

—

594
Minimum withholding taxes on net share settlements of equity awards

—

—

(150)

—

—

(150)
Balances, September 30, 2021

34,636,224

$
34

$
466,017

$
(339,451)

$
(258)

$
126,342

Three months ended September 30, 2021

Balances, June 30, 2021

33,536,476

$
33

$
461,717

$
(334,883)

$
(258)

$
126,609
Net loss

—

—

—

(4,568)

—

(4,568)
Common stock issued, net of issuance costs

1,099,748

1

4,001

—

—

4,002
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes

—

—

299

—

—

299
Balances, September 30, 2021

34,636,224

$
34

$
466,017

$
(339,451)

$
(258)

$
126,342

Common Stock

Paid-In

Accumulated

Treasury

Nine months ended September 30, 2020

Shares

Amount

Capital

Deficit

Stock

Total
Balances, January 1, 2020

3,339,541

$
3

$
319,758

(302,439)

$
(258)

$
17,064
Net loss

—

—

—

(15,505)

—

(15,505)
Common stock issued, net of issuance costs

7,093,960

7

13,523

—

—

13,530
Stock compensation expense and related share issuances, net of shares withheld for the payment of taxes

511

—

170

—

—

170
Balances, September 30, 2020

10,434,012

$
10

$
333,451

$
(317,944)

$
(258)

$
15,259

Three months ended September 30, 2020

Balances, June 30, 2020

6,664,976

$
7

$
326,073

$
(308,193)

$
(258)

$
17,629
Net loss

(9,751)

—

(9,751)
Common stock issued, net of issuance costs

3,769,036

3

7,236

—

—

7,239
Stock compensation expense and related share issuances, net of shares withheld for the payment of taxes

—

—

142

—

—

142
Balances, September 30, 2020

10,434,012

$
10

$
333,451

$
(317,944)

$
(258)

$
15,259


Nine months ended September 30, 2022	Common Stock			Paid-In		Accumulated		Treasury
	Shares	Amount		Capital		Deficit		Stock		Total
Balances, December 31, 2021	35,279,724	$	35	$	468,578	$	(342,157)	$	(258)	$	126,198
Net loss	—		—		—		(9,417)		—		(9,417)
Common stock issued, net of issuance costs	12,619,147		13		25,591		—		—		25,604
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes	167,972		—		703		—		—		703
Minimum withholding taxes on net share settlements of equity awards	—		—		(32)		—		—		(32)
Balances, September 30, 2022	48,066,843	$	48	$	494,840	$	(351,574)	$	(258)	$	143,056


Three months ended September 30, 2022

Balances, June 30, 2022	47,218,863	$	47	$	493,445	$	(348,121)	$	(258)	$	145,113
Net loss	—		—		—		(3,453)		—		(3,453)
Common stock issued, net of issuance costs	796,781		1		1,062		—		—		1,063
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes	51,199		—		333		—		—		333
Balances, September 30, 2022	48,066,843	$	48	$	494,840	$	(351,574)	$	(258)	$	143,056



Nine months ended September 30, 2021	Common Stock			Paid-In		Accumulated		Treasury
	Shares	Amount		Capital		Deficit		Stock		Total
Balances, December 31, 2020	19,172,020	$	19	$	383,723	$	(326,013)	$	(258)	$	57,471
Net loss	—		—		—		(13,438)		—		(13,438)
Common stock issued, net of issuance costs	15,407,018		15		81,850		—		—		81,865
Stock compensation expense and related share issuances, net of shares withheld for payment of taxes	57,186		—		594		—		—		594
Minimum withholding taxes on net share settlements of equity awards	—		—		(150)		—		—		(150)
Balances, September 30, 2021	34,636,224	$	34	$	466,017	$	(339,451)	$	(258)	$	126,342


Three months ended September 30, 2021

Balances, June 30, 2021	33,536,476	$	33	$	461,717	$	(334,883)	$	(258)	$	126,609
Net loss	—		—		—		(4,568)		—		(4,568)
Common stock issued, net of issuance costs	1,099,748		1		4,001		—		—		4,002
Stock compensation expense and related share issuances, net of shares withheld for the payment of taxes	—		—		299		—		—		299
Balances, September 30, 2021	34,636,224	$	34	$	466,017	$	(339,451)	$	(258)	$	126,342

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of Contents

WESTWATER RESOURCES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements for Westwater Resources, Inc. ~~(the “Company,” “we,” “us,” “WWR” or “Westwater”),~~ have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. The accompanying statements should be read in conjunction with the audited financial statements included in ~~Westwater Resources, Inc.’s~~our Annual Report on Form 10-K for the year ended December 31, ~~2020 (“Annual Report”).~~2021. The interim condensed consolidated financial statements are unaudited. In the opinion of management, all adjustments (which are of a normal, recurring nature) considered necessary for a fair presentation have been included. Operating results for the three and nine months ended September 30, ~~2021~~2022 are not necessarily indicative of the results that may be expected for any other period including the full year ending December 31, ~~2021.~~2022.

Significant Accounting Policies

Our significant accounting policies are detailed in Note 1, Summary of Significant Accounting Policies, in the Notes to Consolidated Financial Statements within our Annual Report.

Recently ~~Adopted Accounting Pronouncements~~

In December 2019, the Financial Accounting Standards Board (“FASB”) issued ASU 2019-12, “Income Taxes - Simplifying the Accounting for Income Taxes (Topic 740)” which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. ASU 2019-12 became effective for interim and annual periods beginning after December 15, 2020. The adoption of ASU 2019-12 did not result in a material impact to our condensed consolidated financial statements.

~~Recently~~ Issued Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, “Measurement of Credit Losses on Financial ~~Instruments”.~~Instruments.” ASU 2016-13 will change how companies account for credit losses for most financial assets and certain other instruments. For trade receivables, loans and held-to-maturity debt securities, companies will be required to estimate lifetime expected credit losses and recognize an allowance against the related instruments. For available for sale debt securities, companies will be required to recognize an allowance for credit losses rather than reducing the carrying value of the asset. The adoption of this update, if applicable, will result in earlier recognition of losses and impairments. ASU 2016-13 will be effective for interim and annual periods beginning after December 15, 2022.

In November 2018, the FASB issued ASU 2018-19, “Codification Improvements to ASC 326, Financial Instruments – Credit Losses.” ASU 2016-13 introduced an expected credit loss methodology for the impairment of financial assets measured at amortized cost basis. That methodology replaces the probable, incurred loss model for those assets. ASU 2018-19 is the final version of Proposed Accounting Standards Update 2018-270,Losses”, which ~~has been deleted. Additionally, the amendments clarify~~clarifies that receivables arising from operating leases are not within the scope of Subtopic 326-20. Instead, impairment of receivables arising from operating leases should be accounted for in accordance with ASC 842, Leases. ASU 2018-19 will be effective for interim and annual periods beginning after December 15, 2022.

The Company is currently evaluating ASU 2016-13 and ASU 2018-19 for the potential impact of adopting this guidance on its financial reporting.

~~Table of Contents~~

~~WESTWATER RESOURCES, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

~~Cash, Cash Equivalents and Restricted Cash~~

The following table provides a reconciliation of cash, cash equivalents and restricted cash as reported within the Condensed Consolidated Balance Sheets that sum to the total of the same such amounts shown in the statement of cash flows.

As of September 30,
(thousands of dollars)

2021

2020
Cash and cash equivalents

$
118,969

$
5,480
Restricted cash - pledged deposits for performance bonds

—

3,807
Cash, cash equivalents and restricted cash shown in the statement of cash flows

$
118,969

$
9,287

The Company’s restricted cash on September 30, 2020, consisted of funds held in money market accounts and used as collateral for performance obligation bonds related to the restoration and reclamation of the Company’s South Texas uranium properties. With the divestiture of the Company’s uranium subsidiaries, all performance obligations and related restricted cash was transferred to enCore Energy Corp. (“enCore”) as of December 31, 2020. The funds were not available for the payment of general corporate expenses and were excluded from cash and cash equivalents as of September 30, 2020.

2. LIQUIDITY

The Company last recorded revenues from operations in 2009. Since 2009, the Company has relied on equity financings, debt financings and asset sales to fund its operations. The Company expects to rely on debt and equity financings to fund its operations for the foreseeable future.

In 2016, the Company began to expand its business plan into acquisition and development of energy-related materials. First, in 2016 the Company obtained lithium mineral leases in Nevada and Utah as an exploration opportunity. Then, in 2018 the Company acquired Alabama Graphite Corp. and its Coosa Graphite Project in Alabama for the purpose of developing a commercial sized graphite mineral deposit and processing the flake graphite into advanced graphite products for use in batteries. In the third quarter of 2020, the Company executed the strategic decision to focus its resources on the graphite business in Alabama, discontinuing its investment in its lithium mineral properties and selling its uranium business, located in Texas and New Mexico, to enCore. As discussed in Note 3, the sale to enCore closed on December 31, 2020, and included the elimination of a $9.3 million bonding liability, the elimination of $5.2 million in asset retirement obligations, and the elimination of more than $4.0 million in annual expenditures related to reclamation and compliance costs. The Company received approximately $1.8 million of enCore common stock and retained royalty interests on the New Mexico uranium properties as consideration for the sale. The Company also retained its uranium interests in Turkey, which are subject to ongoing international arbitration proceedings, in which the Company is seeking damages.

During the first nine months of ~~2021,~~2022, the Company ~~focused on~~continued construction activities related to the Kellyton Graphite Plant. The Company also continued its exploration project to investigate the size and extent of both graphite ~~process development activities including the operation of a pilot program for processing flake graphite into battery-grade graphite products~~ and ~~a Definitive Feasibility Study (“DFS”) on Phase I of~~vanadium mineral concentrations at the Coosa Graphite ~~Project. The data generated and experience gained from the pilot program was used to inform the Phase I DFS that~~Deposit. Drilling was completed in ~~October 2021~~April 2022 and ~~will also inform~~ the ~~requirements and specifications for building~~Company expects to complete a ~~commercial graphite processing facility.~~resource model by the end of the year 2022.

On September 30, ~~2021,~~2022, the Company’s cash balance was approximately ~~$119.0~~$100.3 million. During the nine months ended September 30, ~~2021,~~2022, the Company sold ~~9.3~~12.6 million shares of common stock for net proceeds of ~~$47.3 million pursuant to its Controlled Equity Offering~~^SM ~~Sales Agreement with Cantor Fitzgerald & Co. (“Cantor”) and 6.1 million shares of common stock for net proceeds of $34.6~~$25.6 million pursuant to the ~~December 2020 Purchase~~ATM Offering Agreement ~~with Lincoln Park Capital Fund, LLC (“Lincoln Park”)~~ (see Note 7). As of September 30, 2021, the Company has $50.0 million available for future sales under the ATM Offering and has 9,700,252 of common stock available for future sales pursuant to the Lincoln Park December 2020 PA (as defined in Note 7)4).

Table of Contents

~~WESTWATER RESOURCES, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

Subsequent to September 30, 2021, and through the date of this release, the Company has sold 637,200 common shares for net proceeds of $2.3 million pursuant to its financing facility with Cantor Fitzgerald & Co., and liquidated its holdings of enCore common stock for net cash proceeds of $3.6 million.

Management believes the Company’s current cash balance is sufficient to fund its planned non-discretionary expenditures through ~~2022.~~the fourth quarter of 2023. The Company ~~anticipates~~has in place the ~~continued use of~~ATM Offering Agreement and the ~~Cantor and~~2020 Lincoln Park ~~financing facilities~~PA, both of which could be used to support construction of Phase I of the ~~commercial graphite processing facility.~~Kellyton Graphite Plant and the Company’s planned non-discretionary expenditures. While the Company has been successful in the past in raising funds through equity and debt financings as well as through the sale of non-core assets, no assurance can be given that additional financing will be available in amounts sufficient to meet its needs, or on terms acceptable to the Company. Stock price volatility, rising interest rates, inflation and generally uncertain economic conditions ~~caused by the COVID-19 pandemic and the recent emergence of variant strains of the virus~~ could significantly impact the Company’s ability to raise funds through equity or debt financing. ~~Market~~Further, market conditions, including but not limited to, inflation, labor shortages and supply chain disruptions could also adversely impact the planned cost and the construction and commissioning timeline of Phase I of the ~~Company’s commercial graphite processing facility.~~ Kellyton Graphite Plant.

Along with evaluating the continued use of the ~~Cantor~~ATM Offering Agreement and the 2020 Lincoln Park ~~financing facilities,~~PA, the Company ~~may consider~~is considering other forms of project financing to fund the construction of the ~~commercial graphite processing facility. In the event~~Kellyton Graphite Plant, including both Phase I and Phase II. The alternative sources of project financing could include, but are not limited to, project debt, convertible debt, or pursuing a partnership or joint venture. If funds are not available ~~for project financing~~ to ~~complete~~fund the construction of Phase I of the ~~commercial graphite processing facility in 2023,~~Kellyton Graphite Plant under the Company’s financing facilities or through alternative financing sources, the Company expects to be able to fund ~~its~~the Company’s non-discretionary expenditures with the Company’s current cash balance, however in such instance, the Company may be required to change its planned ~~business~~ development ~~strategies.~~strategies related to the Coosa Deposit and Phase I of the Kellyton Graphite Plant, including the construction and commissioning timeline of Phase I of the Kellyton Graphite Plan, or putting the construction of Phase I on hold until additional funding is obtained.

~~3. ACQUISITIONS AND DISPOSALS~~

~~Sale of Uranium Business to enCore Energy~~

On December 31, 2020, Westwater, and its wholly owned subsidiary URI Neutron Holdings II, Inc. (“Neutron Holdings”), entered into a securities purchase agreement with enCore (the “Purchase Agreement”) to sell their subsidiaries engaged in the uranium business in Texas and New Mexico (the “Uranium Subsidiaries”) to enCore. The transaction closed on December 31, 2020.

At the closing of the transaction, enCore delivered $0.7 million in cash and issued $1.8 million worth of its common shares to Westwater, and Westwater and Neutron Holdings transferred all of the equity interests in the Uranium Subsidiaries to enCore along with a database relating to the Grants Mineral Belt located in New Mexico. In addition, enCore delivered to Westwater a 2% net smelter return royalty (“NSR Royalty”) on production from the uranium properties held by Uranco, Inc. in New Mexico, and a 2.5% net profits interest (“NPI”) in the profits from operations of Neutron Energy, Inc.’s Juan Tafoya and Cebolleta Projects. Pursuant to the terms of the Purchase Agreement, enCore has also agreed to replace the indemnification obligations of Westwater for certain reclamation surety bonds held in the name of URI, Inc., and Westwater transferred to enCore all rights to $3.8 million in cash collateral held to secure such indemnity obligations.

Also, at closing, in accordance with the terms of the Side Letter executed by the parties to the Purchase Agreement, Westwater delivered $0.3 million in cash to enCore, which amount was delivered in escrow upon the request of the lender, Celtic Bank, under the loan made to URI, Inc. in May 2020 pursuant to the Small Business Administration (“SBA”) Paycheck Protection Program (the “PPP Loan”). The escrowed amount was to be released to Westwater upon, and subject to, forgiveness of the PPP Loan under the terms of the CARES Act. The PPP Loan forgiveness application was filed on January 25, 2021, and Westwater received a notification from the SBA on March 31, 2021 that 100% of the loan had been forgiven. As a result, on March 31, 2021, the escrowed funds were returned to Westwater.

The divestiture of the uranium business was accounted for as an asset disposal and the non-cash consideration received from enCore was recorded at fair value. In accordance with the terms of the Purchase Agreement, non-cash consideration included the receipt of shares of enCore common stock valued in the amount of $1.8 million. The number of shares issued at closing was 2,571,598. The number of shares was determined by a pricing formula based on the volume

~~Table of Contents~~

~~WESTWATER RESOURCES, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

~~weighted average price (“VWAP”) of enCore’s common shares for the~~ ~~ten~~ ~~trading days ending on and including December 30, 2020. The VWAP formula resulted in a price of $0.698 per share of enCore common stock.~~

Finally, due to the high degree of uncertainties surrounding future mine development and uranium prices, as well as limited marketability, the Company determined the fair value of the NSR Royalty and NPI to be of NaN value.

~~4. FAIR VALUE MEASUREMENTS~~

Applicable accounting standards define fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price) and establishes a fair-value hierarchy that prioritizes the inputs used to measure fair value using the following definitions (from highest to lowest priority):

●

~~Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that are observable at the measurement date.~~

●

Level 2 inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation or other means (market corroborated inputs).

●

Level 3 includes unobservable inputs that reflect management’s assessment about what factors market participants would use in pricing the asset or liability. These inputs are developed based on the best information available, including internal data.

The Company believes that the fair value of its assets and liabilities approximates their reported carrying amounts. The following table presents information about assets that were recorded at fair value on a recurring and non-recurring basis as of September 30, 2021 and December 31, 2020 and indicates the fair value hierarchy.

September 30, 2021
(thousands of dollars)

Level 1

Level 2

Level 3

Total
Current Assets








Equity securities

$
3,438

$
—

$
—

$
3,438
Land grant

—

—

1,378

1,378
Total current assets recorded at fair value

$
3,438

$
—

$
1,378

$
4,816

December 31, 2020
(thousands of dollars)

Level 1

Level 2

Level 3

Total
Current Assets








Equity securities

$
—

$
—

$
1,520

$
1,520
Total current assets recorded at fair value

$
—

$
—

$
1,520

$
1,520
Non-current Assets








Restricted cash

$
10

$
—

—

$
10
Total non-current assets recorded at fair value

$
10

$
—

$
—

$
10

~~Recurring Fair Value Measurements~~

Assets that are measured on a recurring basis include the Company’s marketable securities and restricted cash. Equity securities on the balance sheet at December 31, 2020 and September 30, 2021 consist solely of shares of common

~~Table of Contents~~

~~WESTWATER RESOURCES, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

stock received as partial consideration for the sale of uranium assets to enCore (see Note 3). Further, the sale of the enCore shares was restricted and resulted in the Company applying a discount for the lack of marketability prior to May 1, 2021. As the restrictions on the sale of enCore stock have expired and the shares are currently available for sale, the fair value of the securities now reflects the unadjusted market price of enCore shares as of September 30, 2021. With the lifting of restrictions and no anticipated lack of marketability, the measurement in equity securities is now considered Level 1 in the fair-value hierarchy. For the three and nine months ended September 30, 2021, the Company recognized unrealized gains of $0.5 million and $1.9 million, respectively, related to the increased fair value of the enCore shares.

~~Non-recurring Fair Value Measurements~~

As discussed in Note 5, on July 23, 2021, the Company received a land grant from local municipalities related to its planned graphite processing plant in Coosa County, Alabama. At inception, the Company estimated the fair value of the land to be approximately $1.4 million. The fair value was determined using Level 3 inputs using the market approach, by considering comparable sales in the area, adjusted for property specific items; such as lot size, location and access to major highways and distribution channels. The Company began amortization of the obligation over the ~~10-year~~ ~~lease term.~~

5.3. PROPERTY, PLANT AND EQUIPMENT


	Net Book Value of Property Plant and Equipment at September 30, 2021						Net Book Value of Property Plant and Equipment at September 30, 2022
(thousands of dollars)	Alabama		Corporate		Total		Alabama		Corporate		Total
Mineral rights and properties	$	8,972	$	—	$	8,972	$	8,972	$	—	$	8,972
Other property, plant and equipment		1,378		30		1,408		5,755		26		5,781
Construction in progress		100		—		100		49,506		—		49,506
Total	$	10,450	$	30	$	10,480	$	64,233	$	26	$	64,259


	Net Book Value of Property Plant and Equipment at December 31, 2021
(thousands of dollars)	Alabama		Corporate		Total
Mineral rights and properties	$	8,972	$	—	$	8,972
Other property, plant and equipment		4,462		28		4,490
Construction in progress		1,017		—		1,017
Total	$	14,451	$	28	$	14,479

Construction in Progress

Construction in progress represents assets that are not ready for service or are in the construction stage. Assets are depreciated based on the estimated useful life of the asset once it is placed in service.

During the first quarter of 2022, the manufacturing of certain equipment commenced, for which the Company made cash deposits of $2.7 million as of December 31, 2021. As such, the deposits as of December 31, 2021 are now reflected as construction in progress, and will continue to be included in construction in progress until such assets are placed into service.

Net Book Value of Property Plant and Equipment at December 31, 2020
(thousands of dollars)

Alabama

Corporate

Total
Mineral rights and properties

$
8,972

$
—

$
8,972
Other property, plant and equipment

—

13

13
Total

$
8,972

$
13

$
8,985

Table of Contents

Impairment of Property, Plant and Equipment

The Company reviews and evaluates its long-lived assets for impairment on an annual basis or more frequently when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. For the nine months ended September 30, ~~2021~~2022 no events or changes in circumstance are believed to have impacted recoverability of the Company’s long-lived assets. Accordingly, it was determined that 0no interim impairment was necessary.

~~Land Addition~~

On June 22, 2021, Alabama Graphite Products, LLC (“AGP”), a wholly-owned subsidiary of Westwater entered into incentive agreements with the State of Alabama and local municipalities for the siting of the Company’s planned graphite processing plant in Coosa County, Alabama. The incentive agreements provide certain tax credits and incentives under the Alabama Jobs Act in connection with the construction of the processing facility. Additionally, in connection to, and in contemplation of the incentive agreements, ~~on July 23, 2021, AGP~~ ~~entered into a land lease with the Lake Martin Area Industrial Development Authority. The lease provides AGP rights to approximately~~ ~~70 acres to construct and operate its commercial graphite processing facility in Coosa County, Alabama. The lease has a term of~~

~~Table of Contents~~

~~WESTWATER RESOURCES, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

~~10-years, a nominal lease payment, and transfer of title to AGP at the end of the lease term. Further, the lease provides AGP the option to purchase the land for a nominal amount during the term of the lease.~~

The incentive agreements and the lease are accounted for by the company as a government grant; whereby the Company realized the fair value of the land, subject to the lease, at inception with a corresponding obligation on the consolidated balance sheet. The land is included in property, plant, and equipment, and represents a non-depreciable asset on the Company’s consolidated balance sheet. The corresponding obligation is recorded in other long-term liabilities on the consolidated balance sheet.

~~6. DISCONTINUED OPERATIONS~~

In the third quarter of 2020, the Company executed the strategic decision to focus its resources on its graphite business, and discontinued its investment in its lithium and uranium businesses. The Company’s lithium business included mineral leases and water rights in Nevada and Utah. The Company elected not to renew the annual lease rentals on the mineral properties, which also voids the water rights. On December 31, 2020, the Company sold its subsidiaries engaged in its uranium business to enCore (see Note 3).

~~In accordance with~~ ~~ASC 205-20 – “Discontinued Operations,”~~ the enCore transaction represented a major strategic shift for Westwater and resulted in the reclassification of the Company’s uranium activities as discontinued operations and disclosure of the associated profit/loss of the Company’s uranium business as a separate line-item on the Company’s Condensed Consolidated Statement of Operations for the three and nine months ended September 30, 2020.

~~The results of the Company’s uranium and lithium business segments included in discontinued operations for the three and nine months ended September 30, 2020 were as follows:~~

For the Three Months Ended

For the Nine Months Ended
(thousands of dollars)

September 30, 2020

September 30, 2020
Mineral property expenses

$
(752)

$
(1,924)
General and administrative expenses

(405)

(1,273)
Accretion of asset retirement obligations

(32)

(170)
Depreciation and amortization

(30)

(36)
Impairment of uranium properties

(5,200)

(5,200)
Other income (expense)

30

30
Net Loss from Discontinued Operations

$
(6,389)

$
(8,573)

~~Our cash flow information for the nine months ended September 30, 2020 included the following activities related to discontinued operations:~~

For the Nine Months Ended
(thousands of dollars)

September 30, 2020
Depreciation and amortization
$
36
Capital Expenditures

(101)
Accretion of asset retirement obligations

170
Impairment of uranium properties

5,200

~~Table of Contents~~

~~WESTWATER RESOURCES, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

7.4. COMMON STOCK

Common Stock Issued, Net of Issuance Costs

December 2020 Purchase Agreement with Lincoln Park Capital Fund, LLC

On December 4, 2020, the Company entered into ~~a Purchase Agreement~~the 2020 Lincoln Park PA with Lincoln Park ~~(the “December 2020 PA”)~~ to place up to either $100.0 million or 16.0 million shares in the aggregate of the Company's common stock on an ongoing basis over a term of 36 months. The Company controls the timing and amount of any sales to Lincoln Park, and Lincoln Park is obligated to make purchases in accordance with the ~~December~~ 2020 Lincoln Park PA. Any common stock that is sold to Lincoln Park will occur at a purchase price that is based on an agreed upon fixed discount to the Company's prevailing market prices at the time of each sale and with no upper limits toon the price Lincoln Park may pay to purchase common stock. The ~~agreement~~Lincoln Park PA may be terminated by the Company at any time, in its sole discretion, without any additional cost or penalty.

The ~~December~~ 2020 Lincoln Park PA specifically provides that the Company may not issue or sell any shares of its common stock under the agreement if such issuance or sale would breach any applicable rules of the NYSE American Stock Exchange (“NYSE American”). In particular, NYSE American General Rule 713(a) provides that the Company may not issue or sell more than 19.99% of the number of shares of the Company’s common stock that were outstanding immediately prior to the execution of the ~~December~~ 2020 Lincoln Park PA unless (i) shareholder approval is obtained or (ii) the average price of all applicable sales of common stock to Lincoln Park under the ~~December~~ 2020 Lincoln Park PA, equals or exceeds $6.15. The Company held its 2021 Annual Shareholders Meeting on May 21, 2021 and obtained shareholder approval for the issuance of more than 19.99% of the shares of the Company’s common stock ~~outstanding.~~outstanding under the 2020 Lincoln Park PA.

Lincoln Park has no right to require the Company to sell any shares of common stock to Lincoln Park, but Lincoln Park is obligated to make purchases as the Company directs, subject to certain conditions. In all instances, the Company may not sell shares of its common stock to Lincoln Park under the ~~December~~ 2020 Lincoln Park PA if it would result in Lincoln Park beneficially owning more than 9.99% of ~~its~~the Company’s common stock at any one point in time.

Since inception, the Company has sold 6.3 million shares of common stock to Lincoln Park pursuant to the 2020 Lincoln Park PA.

During the three and nine months ended September 30, ~~2021,~~2022, the Company did not sell any shares of common stock pursuant to the ~~December~~ 2020 ~~PA with~~ Lincoln Park ~~the Company sold~~PA compared to 1.1 million and 6.1 million shares of common stock sold for net proceeds of $4.0 million and $34.6 million, ~~respectively. These shares were sold pursuant to a prospectus supplement filed on December 4, 2020,~~respectively, for the three and in accordance with Rule 424(b)(5) as a takedown off the Company’s shelf registration statement, which had been declared effective by the Securities and Exchange Commission (the “Commission”) on December 1, 2020.nine months ended September 30, 2021.

~~ATM~~

Controlled Equity Offering Sales Agreement with Cantor Fitzgerald & Co.

On April 14, 2017, the Company entered into ~~a Controlled Equity~~the ATM Offering^SM ~~Sales~~ Agreement ~~(the “ATM Offering Agreement”)~~ with Cantor acting as the sales agent. Under the ATM Offering Agreement, the Company may from time to time sell shares of its common stock in “at-the-market” offerings. The Company pays Cantor a commission of up to 2.5% of the gross proceeds from the sale of any shares pursuant to the ATM Offering Agreement.

During the three and nine months ended September 30, 2022, the Company sold 0.8 million and 12.6 million shares of common stock for net proceeds of $1.1 million and $25.6 million, respectively, pursuant to the ATM Offering Agreement. During the nine months ended September 30, 2021, the Company sold 9.3 million shares of common stock

Table of Contents

for net proceeds of $47.3 million, pursuant to the ATM Offering Agreement with Cantor. These shares were sold pursuant to a prospectus supplement filed on December 4, 2020, and in accordance with Rule 424(b)(5) as a takedown off the Company’s shelf registration statement, which had been declared effective by the Commission on December 1, 2020.Agreement. The Company did 0tnot sell any shares of common stock pursuant to the ATM Offering Agreement for the three months ended September 30, 2021.

~~As of September 30, 2021, the Company has $50 million available for sale~~Sales made under the ATM Offering Agreement are made pursuant to a prospectus supplement filed pursuant to Rule 424(b)(5), which registered for sale up to a total of $50.0 million of the Company’s common stock, which was filed on August 20, 2021 ~~and in accordance with Rule 424(b)(5)~~ as a takedown off the Company’s shelf registration statement on Form S-3, which was declared effective by the Commission on July 8, 2021.

~~Table of Contents~~

~~WESTWATER RESOURCES, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

~~Warrants~~

~~The following table summarizes warrants outstanding and changes for the nine months ended September 30, 2021 and 2020:~~

September 30, 2021

September 30, 2020

Number of

Number of

Warrants

Warrants
Warrants outstanding at beginning of period

0

186,182
Issued

0

0
Expired

0

0
Warrants outstanding at end of period

0

186,182

As of September 30, 2022, the Company has received total gross proceeds of $28.8 million since inception under the ATM Offering Agreement.

On October 6, 2020, a warrant holder of 182,515 warrants provided notice of exercise. The warrant holder elected the cashless exercise method to convert the warrants to shares of common stock. Based on the cashless exercise formula, the Company issued the warrant holder 118,799 shares of common stock.

8.5. STOCK-BASED COMPENSATION

Stock-based compensation awards consist of stock options, restricted stock units and bonus shares issued under the Company’s equity incentive plans, which include the 2013 Omnibus Incentive Plan (the “2013 Plan”) and the Amended and Restated 2004 Directors’ Stock Option and Restricted Stock Plan (the “2004 Directors’ Plan”). Upon approval of the 2013 Plan by the Company’s stockholders on June 4, 2013, the Company’s authority to grant new awards under all plans other than the 2013 Plan was terminated. On July 18, 2017, April 18, 2019, April 28, 2020, and May 21, 2021, the Company’s stockholders approved amendments to the 2013 Plan to increase the authorized number of shares of common stock available and reserved for issuance under the 2013 Plan by 20,000, 66,000, 350,000, and 1,500,000 shares, respectively, and in 2017 re-approved the material terms of the performance goals under the ~~plan.~~2013 Plan. Under the 2013 Plan, the Company may grant awards of stock options, stock appreciation rights, restricted stock awards, restricted stock units (“RSUs”), unrestricted stock, dividend equivalent rights, performance shares and other performance-based awards, other equity-based awards and cash bonus awards to eligible persons. Equity awards under the 2013 Plan are granted from time to time at the discretion of the Compensation Committee of the Board (the “Committee”), with vesting periods and other terms as determined by the Committee with a maximum term of 10 years. The 2013 Plan is administered by the Committee, which can delegate the administration to the Board, other ~~Committees~~committees or to such other officers and employees of the Company as designated by the Committee and permitted by the 2013 Plan.

As of September 30, ~~2021, 1,223,939~~2022, shares ~~were~~ available for future issuances under the 2013 ~~Plan.~~Plan were 215,025. For the three and nine months ended September 30, ~~2021,~~2022 the Company recorded stock-based compensation expense of $0.3 million and $0.7 million, respectively, compared to $0.3 million and $0.6 million, ~~respectively.~~respectively, in the same periods in 2021. Stock compensation expense is recorded in general and administrative expenses.

In addition to the plans above, on May 9, 2022, the Board of Directors adopted the Inducement Plan and on May 13, 2022, the Company filed a registration statement on Form S-8 to register an aggregate of 250,000 shares of the Company’s common stock. These shares may be issued pursuant to the Inducement Plan as equity awards to be granted for the sole purpose of recruiting and hiring new employees. No shares have been issued under the Inducement Plan as of September 30, 2022. Subsequent to September 30, 2022, on October 4, 2022 the Company issued 58,946 restricted stock units under the Inducement Plan that vest over two years.

1412

Table of Contents

~~WESTWATER RESOURCES, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

Stock Options

Stock options are valued using the Black-Scholes option pricing model on the date of grant. The Company accounts for forfeitures upon occurrence.

The following tables summarize stock options outstanding and changes for the nine months ended September 30, ~~2021 and 2020:~~2022:


	September 30, 2021			September 30, 2020			September 30, 2022			September 30, 2021
		Weighted			Weighted			Weighted			Weighted
	Number of	Average		Number of	Average		Number of	Average		Number of	Average
	Stock	Exercise		Stock	Exercise		Stock	Exercise		Stock	Exercise
	Options	Price		Options	Price		Options	Price		Options	Price
Stock options outstanding at beginning of period	185,054	$	7.99	37,786	$	37.42	277,576	$	6.18	185,054	$	7.99
Granted	94,522		3.91	125,804		1.59	78,720		1.09	94,522		3.91
Expired	(2,000)		73.54	(1,693)		101.64	—		—	(2,000)		73.54
Stock options outstanding at end of period	277,576		6.18	161,897		9.25	356,296		5.06	277,576		6.18
Stock options exercisable at end of period	183,054	$	7.35	36,093	$	34.41	277,576	$	6.18	183,054	$	7.35

The weighted average remaining term for stock options outstanding as of September 30, 2022, is approximately 8.2 years.

The following table summarizes stock options outstanding and exercisable by stock option plan at September 30, ~~2021:~~2022:


	Outstanding Stock Options			Exercisable Stock Options			Outstanding Stock Options			Exercisable Stock Options
	Number of	Weighted		Number of	Weighted		Number of	Weighted		Number of	Weighted
	Outstanding	Average		Stock Options	Average		Outstanding	Average		Stock Options	Average
Stock Option Plan	Stock Options	Exercise Price		Exercisable	Exercise Price		Stock Options	Exercise Price		Exercisable	Exercise Price
2004 Plan	92	$	1,638.00	92	$	1,638.00	92	$	1,638.00	92	$	1,638.00
2004 Directors’ Plan	3		10,380.00	3		10,380.00	3		10,380.00	3		10,380.00
2013 Plan	277,481		5.53	182,959		6.36	356,201		4.55	277,481		5.53
	277,576	$	6.18	183,054	$	7.35	356,296	$	5.06	277,576	$	6.18

As of September 30, 2022, the Company had less than $0.1 million of unrecognized compensation costs related to non-vested stock options that will be recognized over a period of approximately nine months.

Table of Contents

Restricted Stock Units

Time-based and performance-based RSUs are valued using the closing share price of the Company’s common stock on the date of grant. The final number of shares issued under performance-based RSUs is generally based on the Company’s prior year performance as determined by the Committee at each vesting date, and the valuation of such awards assumes full satisfaction of all performance criteria.

The following table summarizes RSU activity for the nine months ended September 30, ~~2021~~2022 and ~~2020:~~2021:


	September 30,			September 30,			September 30,			September 30,
	2021			2020			2022			2021
		Weighted-			Weighted-			Weighted-			Weighted-
		Average			Average			Average			Average
	Number of	Grant Date		Number of	Grant Date		Number of	Grant Date		Number of	Grant Date
	RSUs	Fair Value		RSUs	Fair Value		RSUs	Fair Value		RSUs	Fair Value
Unvested RSUs at beginning of period	236,403	$	2.10	0	$	0	385,004	$	3.18	236,403	$	2.10
Granted	240,125		3.93	211,497		2.03	1,168,003		1.16	240,125		3.93
Forfeited	0		0	0		0
Forfeited/Expired							(225,091)		2.39	—		—
Vested	(78,801)		2.10	0		0	(181,991)		2.31	(78,801)		2.10
Unvested RSUs at end of period	397,727	$	3.20	211,497	$	2.03	1,145,925	$	1.42	397,727	$	3.20

As of September 30, 2022, the Company had $0.8 million of unrecognized compensation costs related to non-vested restricted stock units that will be recognized over a period of approximately 2.25 years.

6. OTHER (EXPENSE) INCOME, NET


	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
(thousands of dollars)	2022		2021		2022		2021
Other (expense) income:
Foreign exchange loss		(649)		—		(645)		—
Interest income		352		8		453		18
Other income		1		27		1		26
Total other (expense) income, net	$	(296)	$	35	$	(191)	$	44

As of the three and nine months ended September 30, 2022, the Company recognized $0.6 million of foreign currency exchange loss related to our Euro denominated bank account. As of September 30, 2022, the Company’s cash balance included approximately 9.5 million Euros. The foreign exchange loss was calculated using the exchange rate as of the balance sheet date. A change in the Euro to USD exchange rate of $0.01 results in a foreign exchange adjustment of less than $0.1 million.

As of the three and nine months ended September 30, 2022, the Company recognized interest income of $0.4 million and $0.5 million, respectively, in our investment account.

9.7. EARNINGS PER SHARE

Basic and diluted loss per common share have been calculated based on the weighted-average shares outstanding during the period. Additionally, potentially dilutive shares of ~~675,303~~1,502,221 from the unvested RSUs and the outstanding stock options at the end of the period were excluded from the calculation of earnings per

~~Table of Contents~~

~~WESTWATER RESOURCES, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

share because the effect on the basic income per share would be anti-dilutive, as the Company had a net loss for the three and nine months ended September 30, ~~2021.~~2022.

~~10.~~14

Table of Contents

8. COMMITMENTS AND CONTINGENCIES

Future operations on the Company’s properties are subject to federal and state regulations for the protection of the environment, including air and water quality. The Company evaluates the status of current environmental laws and their potential impact on current operating costs and accrual for future costs. The Company believes its operations are materially compliant with current, applicable environmental regulations.

At any given time, the Company may enter into negotiations to settle outstanding legal proceedings and any resulting accruals will be estimated based on the relevant facts and circumstances applicable at that time. We do not expect that such settlements will, individually or in the aggregate, have a material effect on our financial position, results of operations or cash flows.

~~11.~~9. LEASES

The Company’s lease portfolio consists of an operating ~~leases~~lease for the corporate ~~offices,~~office, storage space and equipment. The ~~leases have~~corporate office lease has a remaining lease ~~terms~~term of ~~1.1~~0.83 years ~~to 1.8 years, one of which~~and includes an option to extend the ~~corporate office~~ lease for 3 years. Under our corporate office lease, we are required to reimburse the lessor each month for common use expenses such as maintenance and security services. Because these amounts are variable from year to year and not specifically set in the lease terms, they are not included in the measurement of the right-of-use asset and related lease liability, but rather expensed in the period incurred.

The Company is party to several leases that have terms that are less than a year in length. These include leases for land used in exploration ~~and mining~~ activities, office equipment, machinery, office space, storage and other. The Company has elected the short-term lease exemption allowed under the new leasing standards, whereby leases with initial terms of one year or less are not capitalized and instead expensed on a straight-line basis over the lease term. In addition, the Company holds several leases related to mineral exploration and production to which it has not applied the new leasing standard. Leases to explore or use minerals and similar nonregenerative resources are specifically excluded by ASC 842, “Leases.”

The right-of-use assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Right-of-use assets and lease liabilities were recognized at the commencement date of the lease based on the present value of lease payments over the lease term using a discount rate of 9.5%. This rate is the Company’s estimated incremental borrowing rate at the lease commencement date.

The components of lease expense are as follows:


	For the Nine Months Ended				For the Nine Months Ended
	September 30,				September 30,
(thousands of dollars)	2021		2020		2022		2021
Operating lease cost	$	115	$	112	$	115	$	115

Supplemental cash flow information related to the Company’s operating leases is as follows:


	For the Nine Months Ended
	September 30,
(thousands of dollars)	2022		2021
Cash paid for amounts included in lease liabilities:
Operating cash flows from operating leases	$	119	$	115

Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	122	$	258

1615

Table of Contents

~~WESTWATER RESOURCES, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

~~Supplemental cash flow information related to the Company’s operating leases is as follows:~~

For the Nine Months Ended

September 30,
(thousands of dollars)

2021

2020
Cash paid for amounts included in lease liabilities:




Operating cash flows from operating leases

$
115

$
115

Right-of-use assets obtained in exchange for lease obligations:




Operating leases

$
258

$
383

Supplemental balance sheet information related to the Company’s operating leases is as follows:


	September 30,		December 31,		September 30,		December 31,
(thousands of dollars, except lease term and discount rate)	2021		2020
(thousands of dollars)					2022		2021
Operating Leases
Operating lease right-of-use assets	$	258	$	353	$	122	$	226

Current portion of lease liabilities		151		149
Operating lease liability, current						128		152
Operating lease liabilities – long term portion		117		214		—		83
Total operating lease liabilities	$	268	$	363	$	128	$	235

Weighted-average remaining lease term and discount rate for the Company’s operating ~~leases~~lease are as follows:


	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
	2021		2020		2022		2021
Weighted Average Remaining Lease Term (in years)	1.8		3.0		0.8		1.8

Discount Rate	9.5	%	9.5	%	9.5	%	9.5	%

Maturities of lease liabilities for the Company’s operating leases are as follows:


Lease payments by year	September 30,		September 30,
(in thousands)	2021		2022
2021 (remainder of year)	$	39
2022		158
2022 (remainder of year)			$	40
2023		92		92
Total lease payments		289		132
Less imputed interest		(21)		(4)
Total	$	268	$	128

As of September 30, ~~2021,~~2022, the Company has ~~$0.3~~$0.1 million in right-of-use assets and ~~$0.3~~$0.1 million in related lease liabilities, ~~($0.2 million~~all of which is ~~current).~~current. The most significant operating lease is for the Company’s corporate office in Centennial, Colorado, with ~~$0.3~~$0.1 million remaining in undiscounted cash payments through the end of the lease term in 2023. The total undiscounted cash payments remaining on operating leases through the end of their respective terms is ~~$0.3~~$0.1 million.

~~Table of Contents~~

~~WESTWATER RESOURCES, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~(unaudited)~~

~~12. SUBSEQUENT EVENTS~~

On October 13, 2021, Alabama Graphite Products, LLC (“AGP”), a wholly-owned subsidiary of Westwater, completed the purchase of 2 buildings that total 90,000 sq. ft. for approximately $3.1 million. The purchase of the 2 buildings supports the development of AGP’s Coosa Graphite Project, as both buildings are adjacent to the future site of the planned processing plant, and will be used for administrative offices, laboratory, and warehousing space.

1816

Table of Contents

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following management’s discussion and analysis of the consolidated financial results and condition of Westwater for the three and nine months ended September 30, ~~2021,~~2022, has been prepared based on information available to us as of November ~~10, 2021.~~9, 2022. This discussion should be read in conjunction with the unaudited Condensed Consolidated Financial Statements and notes thereto included herewith and the audited Consolidated Financial Statements of Westwater for the period ended December 31, ~~2020~~2021 and the related notes thereto ~~filed with~~included in our Annual Report, ~~on Form 10-K,~~ which ~~have been~~were prepared in accordance with U.S. GAAP. This management’s discussion and analysis contains forward-looking statements that ~~involve~~are subject to risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including, but not limited to, those set forth elsewhere in this report. See “Cautionary Note Regarding Forward-Looking Statements” herein.

INTRODUCTION

Westwater Resources, Inc. ~~is a 44-year-old public company trading on the NYSE American Stock Exchange (“NYSE American”) focused on battery graphite development under the symbol “WWR.” Originally~~, originally incorporated in 1977, ~~as Uranium Resources, Inc. to mine uranium in Texas, our~~is a 45-year-old energy technology company ~~pivoted to an energy materials developer. Westwater is~~ focused on developing battery-grade natural graphite materials after its acquisition of Alabama Graphite ~~Corp. (“Alabama Graphite”) and its Coosa Graphite Project (“Coosa Project”) in Alabama~~ in April 2018. ~~Combined with~~Alabama Graphite holds mineral rights to explore and potentially mine the ~~anticipated~~Coosa Graphite Deposit. During the first nine months of 2022, AGP continued construction activities related to Phase I of ~~a battery graphite processing facility near~~the Kellyton Graphite Plant and in April of 2022 Alabama Graphite completed the ~~Company is executing an~~initial drilling stage of its exploration ~~plan~~program to further investigate the size and extent of both graphite and vanadium mineral concentrations at the Coosa ~~graphite deposit,~~Graphite Deposit. The Coosa Graphite Deposit is located near Rockford, Alabama ~~to increase our knowledge of the deposit as a whole.~~at 32 ° 54’ 30” North and 86 ° 24’ 00” West.

RECENT DEVELOPMENTS

Kellyton Graphite ~~Processing Pilot Programs~~Plant – Construction Update

During the third quarter ~~ended September 30, 2021,~~of 2022, the Company continued and in October 2021 substantially completed, its pilot program at Dorfner Anzaplan’s facilities near Amberg, Germany, as well as at facilities in Frankfurt, Germany, Chicago, Illinois and Buffalo, New York. The combined effort at these facilities produced approximately 13 metric tonnes of Westwater’s three battery-grade graphite products: ULTRA-PMG™, ULTRA-CSPG™ and ULTRA-DEXDG™, which were previously produced at a bench scale.

~~As of September 30, Westwater had produced through the pilot program:~~

●

~~10.8 metric tonnes of ULTRA-PMG™ in six sizes (6, 8, 10, 15, 30 and 44 microns): Production is now complete, and samples will be packaged and shipped to a laboratory for testing.~~

●

2.0 metric tonnes of the precursor (Spherical Purified Graphite) for ULTRA-CSPG™ in three sizes (10, 18 and 24 microns): Production of this product is now complete and has been sent to a laboratory for pitch coating to make ULTRA-CSPG™, and test its electrical performance.

●

~~0.4 metric tonnes of ULTRA-DEXDG™: Production is now complete and samples were packaged and shipped to a laboratory for testing.~~

Westwater undertook its pilot program operations to inform and enhance design work for its commercial production facility and to produce products for testing by potential customers. The information from the pilot program was incorporated into the Definitive Feasibility Study (“DFS”).

~~Definitive Feasibility Study on the Coosa Graphite Project~~

~~On October 11, 2021, the Company announced the results of the DFS pertaining~~construction activities related to Phase I of its ~~Coosa~~Kellyton Graphite ~~Processing Facility (the “Project”). The~~Plant, including the completion of earthwork and site grading. Construction activity during the third quarter also included receipt of more long-lead equipment components, and further work on underground utilities, foundations, and the manufacturing of plant buildings.

As previously announced, in April 2022, the Company ~~intends~~completed the buildout of its Kellyton administrative offices, hosted a groundbreaking ceremony at the site of the Kellyton Graphite Plant, and selected a general contractor for the construction of the Kellyton Graphite Plant. In June 2022, the Company received its air permit from the Alabama Department of Environmental Management and consequently has all necessary permits to ~~develop~~complete the ~~Project to purify natural graphite concentrates and to produce battery ready graphite products in two phases. The capital costs~~construction of Phase I of the ~~Project are~~

~~Table of Contents~~

~~estimated at $202 million. Beginning in early 2023, the Project is expected to begin producing from purchased feedstock from outside sources until at least 2028, after~~Kellyton Graphite Plant. The Company also applied for its wastewater disposal permit, which the Company expects to produce graphite feedstock from its Coosa Project. After processing and purification, the Company expects approximately 7,500 mt per year of two products to be commercially available in the following quantities:

●

~~CSPG: 3,700 mt per year~~

●

~~Fine Products from SPG milling: 3,800 mt per year~~

●

~~Project Duration: 35 years~~

●

~~Pre-Tax NPV-8 percent: $119 million~~

●

~~IRR: 15%~~

●

~~Annual Pre-Tax Cash Flow (After the year 2024): $24 million per year~~

●

~~Project Pre-Tax Cash Flow: $656 million.~~

Also on October 11, 2021, the Company announced a plan and design for Phase II of the project at a pre-feasibility level (“PFS”). The PFS for Phase II of the Project estimates capital costs of $464 million, and after processing and purification, the Company expects approximately 32,400 mt per year of two products will be ~~available in~~required before the ~~following quantities:~~

●

~~CSPG: 15,800 mt per year~~

●

~~Fine Products from SPG milling: 16,600 mt per year~~

●

~~Project Duration: 35 years~~

●

~~Pre-Tax NPV-8 percent: $767 million~~

●

~~IRR: 20.5%~~

●

~~Average Annual Pre-Tax Cash Flow (After the year 2024): $129 million~~

●

~~Project Pre-Tax Cash Flow: $3.7 billion~~

Kellyton Graphite Plant commences operations. The Company ~~intends~~has estimated the cost to ~~initiate a DFS for Phase II upon completion~~construct and ~~commissioning of~~commission Phase I of the ~~Project.~~

~~Approval~~Kellyton Graphite Plant to be approximately $202 million, of ~~Construction of Phase I~~which approximately $50.5 million has been incurred to date. Subject to global supply chain disruptions and ~~Purchase of Industrial Space~~

~~On October 11, 2021,~~challenges, and the Company’s ~~Board of Directors approved estimated expenditures of $202 million~~ability to ~~execute~~raise the ~~construction and commissioning plan for~~remaining capital necessary to complete Phase I of the ~~Project. Construction related activities are expected~~Kellyton Graphite Plant, the Company is targeting that it will begin testing and commissioning Phase I of the Kellyton Graphite Plant in mid-year 2023 and expects the testing and commissioning to ~~begin before~~continue in the ~~end~~second half of ~~2021.~~2023.

Coosa Graphite Deposit – Exploration Program

The Company began an exploration project in April 2021 to investigate the size and extent of both graphite and vanadium mineral concentrations at the Coosa Graphite Deposit. In ~~addition, on October 13, 2021~~April 2022, the Company completed the ~~purchase of two buildings~~drilling activity related to this exploration program and expects to complete a resource model by ~~its subsidiary, Alabama Graphite Products, LLC, that total 90,000 sq. ft. in size, to support~~ the ~~development~~end of the ~~Project. These buildings will be used for administrative offices, a laboratory, and warehousing space, and each are adjacent to the planned processing plant.~~year 2022. The ~~purchase of these two buildings avoids the need for certain construction activities.~~

~~Vanadium Target Identification~~

~~In late November 2018, Westwater announced the discovery~~exploration program was conducted on approximately 4,000 acres out of a concentration of vanadium mineralization at several locations in the graphitic schists at the Coosa Project. Westwater subsequently commenced the first of a four-phase exploration program designed to determine the extent, character and qualitytotal of the ~~vanadium mineralization at the Coosa Project. The first phase demonstrated widespread positive values~~approximately 41,965 acres for ~~vanadium that extended beyond the graphite deposit,~~which Westwater holds mineral rights. In addition, as ~~defined in the 2015 Preliminary Economic Assessment for the site.~~

~~The second phase~~part of the vanadium exploration project began in April 2021 and is expected to continue throughout the remainder of the year. Scope for this effort includes drilling various targets to expand the Company’s knowledge of the geology, examining the core and/or cuttings for mineral constituents, and adding to the existing geologic model. In addition,resource model, vanadium mineralization is expected to be evaluated using extractive metallurgy techniques to ascertain the economic potential, if any, ~~economic potential.~~

of the vanadium at the Coosa Graphite Deposit. Subject to its own definitive feasibility study, the availability and costs of financing, and regulatory approval, the Company anticipates that the mining operations related to the Coosa Graphite Deposit will commence by the end of 2028.

2017

Table of Contents

Graphite and Vanadium ~~Listed~~ as Critical Materials

On February 24, 2021, the President signed an Executive Order that seeks to provide for more resilient supply chains to revitalize and rebuild domestic manufacturing capacity and maintain America’s competitive edge in research and development. Graphite and vanadium are specifically named as critical minerals in which the United States is heavily dependent on China for its supply.

The President’s declaration asked the Secretary of Energy, as part of larger study involving several branches of the United States government, to submit a report identifying risks to the supply chain for high-capacity batteries including those that power electric vehicles. On June 8, 2021, the White House released a response to the findings of this study in support of securing an end-to-end domestic supply chain for advanced batteries, including investment in domestic production and processing of critical minerals. Key recommendations in the June 8, 2021 release include, among other things, providing funding and financial incentives to encourage consumer adoption of electric vehicles, providing financing to support advanced battery production, and investing in the development of next generation batteries. The February 2021 Executive Order and the key recommendations in the June 8, 2021 White House release, builds upon the prior Administration’s Executive Order issued on September 30, 2020, related to critical minerals, and could be important to Westwater’s plans to develop its battery graphite business in the United States.

Presently, the United States is almost 100% dependent on imports for battery-grade graphite, which is currently the primary anode material in the ~~Lithium-Ion~~Lithium-ion batteries that power electric vehicles, smartphones, laptops, ~~electric vehicles,~~ and store power generated from intermittent renewable energy sources. Westwater intends to ~~develop the Coosa Project to supply~~process natural flake graphite ~~for beneficiation~~ into battery-grade graphite for all types of batteries including Lithium-ion batteries.

~~Further details~~On March 31, 2022, President Biden invoked the Defense Production Act to encourage the domestic production of critical materials, including graphite, for advanced batteries for electric vehicles and clean energy storage.

On August 16, 2022, President Biden signed into law the Inflation Reduction Act (“IRA”). This legislation includes an investment of $369 billion in climate programs. The IRA provides a 10% tax credit for the costs of producing certain critical minerals, including graphite and vanadium. This credit is eligible for direct pay and is also transferable to unrelated taxpayers. In addition, a key provision of the IRA that could indirectly benefit the Company is the Clean Vehicle credit. Prior to the passage of the IRA, there was a limit placed on manufacturers once a manufacturer had sold at least 200,000 electric vehicles; however, the IRA eliminates the limitation on the ~~Executive Order on America’s Supply Chains~~number of electric vehicles a manufacturer can sell before the Clean Vehicle credit is phased out or eliminated. Further, the IRA sets a minimum domestic content threshold for the percentage of the value of applicable critical minerals contained in the battery of the electric vehicles. As Westwater intends to produce battery grade graphite for lithium-ion batteries to be ~~found at https://www.whitehouse.gov/briefing-room/presidential-actions/2021/02/24/executive-order-on-americas-supply-chains/.~~

~~Further details on~~used in electric vehicles in the June 8, 2021 White House press release can be found at https://www.whitehouse.gov/briefing-room/statements-releases/2021/06/08/fact-sheet-biden-harris-administration-announces-supply-chain-disruptions-task-force-to-address-short-term-supply-chain-discontinuities/United States, management believes the domestic content requirement could provide indirect future benefit to the Company.

Westwater ~~intends~~has and will continue to support the efforts by the relevant United States governmental agencies to ensure that they remain aware of the importance of natural battery-grade graphite, its importance to the nation’s security, and how the Kellyton Graphite Plant and the Coosa Graphite ~~Project fits~~Deposit fit into the critical minerals-equation.

~~The COVID-19 Pandemic and our Actions to Ensure Safety~~

On March 11, 2020, the World Health Organization designated COVID-19 as a global pandemic. The pandemic spread outside of China during the first quarter of 2020 and has impacted businesses and economies throughout the world. In the U.S., many state and local governments have, based on local conditions, either recommended or mandated actions to slow the transmission of COVID-19. These measures range from limitations on crowd size to masking to mandatory orders for non-essential citizens to test and quarantine. Borders between many countries have been closed to contain the spread of COVID-19. Uncertainty with respect to the economic effects of the pandemic has introduced significant volatility in the financial markets.

To the extent that the COVID 19 pandemic continues or worsens, including by reason of the emergence of variant strains of the virus, local governments or governmental agencies may impose additional restrictions. The result of COVID 19 and those restrictions could result in a number of adverse impacts to Westwater’s business, including but not limited to additional disruption to the economy, additional work restrictions, and supply chains being interrupted, slowed, or rendered inoperable. As a result, it may be challenging to obtain and process raw materials to support business needs, and individuals could become ill, quarantined, or otherwise unable to work and/or travel due to health reasons or governmental restrictions. Governments may also impose other laws, regulations or taxes which could adversely impact Westwater’s business, financial condition or results of operations. The potential effects of COVID 19 could also impact Westwater in a number of other ways including, but not limited to, laws and regulations affecting business, the availability of future borrowings, the cost of borrowings, and potential impairment of the carrying value of long-lived tangible assets.

~~Table of Contents~~

This pandemic, and the uncertain economic conditions it has created, could adversely affect our operations, major facilities, or employees’ health. Westwater has the following priorities while managing business activities during this period of volatility and uncertainty:

●

~~First, to ensure the health and safety of our employees and the communities where they work.~~

●

~~Second, to work with our business partners to maintain the advanced graphite product development schedule in a safe and measured manner.~~

●

~~Third, to ensure the Company has access to adequate financial liquidity to support key operations and business activities.~~

Westwater’s corporate business activities are largely unaffected at this time by the COVID-19 pandemic. Prior to March 1, 2021, Westwater reduced utilization of its offices and remote working arrangements were instituted to ensure that some employees were able to work remotely using systems that already were in place. On March 1, 2021, Westwater reopened its Centennial corporate facility and allowed employees to return to the office to work together with appropriate health protocols in place. Westwater’s continued focus on the health and safety of employees, the safety of operations, and the safety of the communities in which our employees live and work remains paramount. To that end, Westwater has continued to restrict unnecessary travel, and ensured that employees are permitted to take time off due to illness or the illness of those around them without penalty.

Equity Financings

Capital Raises during three and nine months ended September 30, ~~2021~~2022

During the three and nine months ended September 30, ~~2021,~~2022 the Company sold ~~1.1~~0.8 million and 12.6 million shares of common stock for net proceeds of ~~$4.0~~$1.1 million and $25.6 million, respectively, pursuant to the ~~December 2020 PA entered into with Lincoln Park.~~

~~During the nine months ended September 30, 2021, the Company received net proceeds of $81.9 million from its equity facilities,~~ATM Offering Agreement, resulting in a cash balance of approximately ~~$119.0~~$100.3 million at September 30, 2021. The significant treasury balance has mitigated the Company’s capital risk through 2021 and 2022 as the Company’s budgeted pilot program for processing battery-grade graphite and the remaining budgeted product development costs are now fully funded. The Company anticipates making a substantial initial investment in the Project in the fourth quarter of 2021.2022.

~~Transfer of Common Stock Listing~~See Note 4 to the ~~NYSE American Stock Exchange~~financial statements for additional information.

On March 8, 2021, the Company, acting pursuant to authorization from its Board of Directors, determined to voluntarily withdraw the listing of the Company's common stock, par value $0.001 per share, from The Nasdaq Capital Market (“Nasdaq”) and transfer the listing to the NYSE American. The Company informed Nasdaq on March 8, 2021, of its intent to transfer the listing of its common stock to the NYSE American. The Company’s listing and trading of its common stock on Nasdaq ended at market close on March 18, 2021, and trading began on the NYSE American on March 19, 2021. The Company’s common stock continues to trade under the ticker symbol “WWR” on the NYSE American.

RESULTS OF OPERATIONS

Summary

Our net loss ~~from continuing operations~~ for the three months ended September 30, ~~2021,~~2022, was ~~$4.6~~$3.5 million, or ~~$0.13~~$0.07 per share, as compared with a net loss ~~from continuing operations~~ of ~~$3.4~~$4.6 million, or $0.13 per share for the same period in 2021. The $1.1 million decrease in our net loss was due primarily to lower product development expenses, arbitration costs, and exploration expenses; offset partially by increases in general and administrative expenses, foreign exchange loss adjustment for our Euro denominated bank account and no unrealized gain on equity securities, which were sold in the fourth quarter of 2021.

Our net loss for the nine months ended September 30, 2022 was $9.4 million, or $0.21 per share, as compared with a net loss of $13.4 million, or $0.42 per share for the same period in ~~2020.~~2021. The ~~$1.2~~$4.0 million ~~increase~~decrease in our net loss ~~from continuing operations~~ was due primarily to decreases in product development expenses, arbitration costs, and exploration expenses; offset partially by increases in general and administrative ~~arbitration, exploration,~~expenses, foreign exchange loss adjustment for our Euro denominated bank account and ~~product development expenses; offset partially by an~~no unrealized gain ~~related to~~on equity securities, which were sold in the ~~enCore common stock~~fourth quarter of ~~$0.5 million.~~2021.

2218

Table of Contents

~~For the~~Product Development Expenses

Product development expenses for three and nine months ended September 30, ~~2021, our net loss from continuing operations was $13.4~~2022, were $0.3 million ~~or $0.42 per share, as~~and $0.9 million, respectively, a decrease of $1.6 million and $4.9 million, respectively, compared ~~with a net loss from continuing operations of $6.9 million, or $1.18 per share for~~to the same ~~period~~periods in 2020. The $6.5 million increase in our net loss from continuing operations was due primarily to increases in product development, arbitration, general and administrative, and exploration expenses; offset partially by an unrealized gain related to the enCore common stock of $1.9 million.

2021. Product development ~~expenses~~

~~Product development expenses~~costs for the three and nine months ended September 30, ~~2021, were $1.8 million~~2022, primarily relate to continued product development, product optimization costs, and ~~$5.8 million, respectfully, an increase~~continued sample production of ~~$0.2 million and $3.8 million compared to the same periods in 2020.~~battery-grade natural graphite products for evaluation by potential customers. Product development costs in the comparable periods of 2021 were primarily comprised of expenses for our ~~DFS,~~definitive feasibility study related to Phase I of the Kellyton Graphite Plant, which began in February 2021 and was completed in October 2021, and our ~~product development~~graphite processing pilot program ~~continued through the first nine months of~~that was completed in 2021. ~~The product development program includes costs incurred to collaborate with outside experts for lab work, product testing and other auxiliary costs associated with the Coosa Project.~~

Arbitration Costs

During the ~~first~~three months and nine months ended September 30, 2022, arbitration costs decreased by $0.6 million and $2.0 million, respectively, compared to the same periods in 2021. The decrease in arbitration costs during the first three quarters of ~~2021, Westwater incurred~~2022 was due to lower legal ~~and expert consulting costs of $2.2 million associated with~~fees related the ~~Request~~Company’s request for Arbitration against the Republic of Turkey. ~~This represents an increase~~During the first three quarters of ~~152%, or $1.3 million in costs compared to~~2021, the ~~nine months ended~~Company incurred legal fees for the hearing on substantive issues, which was conducted during the week of September ~~30, 2020.~~13-17, 2021. For further reference, see ~~discussion below in~~ Part ~~II,~~I, Item 1.3 of the Annual Report.

~~Mineral property~~General and Administrative Expenses

General and administrative expenses

~~Mineral property expenses were $0.1 million~~ for ~~both the~~ three and nine months ended September 30, ~~2021, an increase of $0.1~~2022, increased by $0.4 million and $1.0 million, respectively, compared to the same periods in ~~2020.~~2021. The ~~increase in mineral property expenses was~~increases are due primarily to ~~higher payments~~increased personnel costs as the Company continues to ~~land and surface owners for increased activities related to our exploration program.~~build its team.

~~General and Administrative~~Exploration Expenses

~~Significant expenditures for general and administrative~~Exploration expenses for the three and nine months ended September 30, 2022, decreased by $0.1 million and $0.2 million compared to the same periods in 2021. The decrease for the three and nine month periods of 2022 compared to the same periods in 2021 ~~and 2020 were:~~is due primarily to the Company completing the drilling stage of its exploration program in April 2022.

For the Three months ended

For the Nine months ended

September 30,

September 30,


2021

2020

2021

2020


(thousands of dollars)

Stock compensation expense

$
299

$
142

$
594

$
170

Salaries and payroll burden

748

811

2,007

2,344

Legal, accounting, public company expenses

575

558

2,090

1,681

Insurance and bank fees

146

160

490

494

Consulting and professional services

106

46

491

149

Office expenses

145

128

352

329

Sales and marketing

157

97

393

196

Other expenses

13

(1)

53

16

Total general and administrative expenses

$
2,189

$
1,941

$
6,470

$
5,379

(Less) General and administrative expenses from discontinued operations

—

(405)

—

(1,273)

General and administrative expenses from continuing operations

$
2,189

$
1,536

$
6,470

$
4,106

~~General and administrative~~Other Expenses

Other expenses for the three and nine months ended September 30, ~~2021,~~2022, increased by $0.3 million and ~~$1.1~~$0.2 million, ~~from~~respectively, compared to the same periods in ~~2020.~~2021. The increase ~~quarter over quarter is due primarily to higher costs~~

~~Table of Contents~~

related to an increase in stock compensation, and higher costs related to the Company’s sales and marketing efforts that began in the third quarter of 2020. The increase for the first nine months of 2021 compared to the same period in 2020 is due primarily to higher costs related to an increase in stock compensation, higher public company expenses related to the annual shareholder meeting and moving to the NYSE American from the NASDAQ, and higher costs related to the Company’s sales and marketing efforts that began in the third quarter of 2020. These increases for the three and nine month periods ~~were~~of 2022 compared to the same periods in 2021 is due primarily to foreign exchange loss adjustment of $0.6 million for our Euro denominated bank account; offset partially by ~~lower personnel costs due~~interest income of $0.4 million on our investment account. A change in the Euro to ~~the sale~~USD exchange rate of ~~our uranium business at December 31, 2020.~~

~~Net Loss from Discontinued Operations~~$0.01 results in a foreign exchange adjustment of less than $0.1 million.

Westwater sold its uranium business on December 31, 2020. As a result, the net loss from discontinued operations was $6.4 million and $8.6 million for the three and nine months ended September 30, 2020, respectively. See Note 3 to the financial statements for additional information.

FINANCIAL POSITION

Operating Activities

Net cash used in operating activities ~~was $13.0~~of $8.6 million for the nine months ended September 30, ~~2021, as~~2022, represents a decrease of $4.5 million compared ~~with cash used in operating activities of $10.1 million for~~to the same period in ~~2020.~~2021. The ~~$2.9 million increase~~decrease in cash used in operating activities was due primarily to ~~increased graphite~~decreases in product development ~~exploration,~~expenses and arbitration costs; offset partially, by a foreign exchange loss on our Euro denominated bank account and higher general and administrative ~~and arbitration costs.~~expenses as discussed in Results of Operations.

Table of Contents

Investing Activities

Net cash used in investing activities ~~decreased~~increased by ~~$0.1~~$31.9 million for the nine months ended September 30, ~~2021,~~2022, as compared to the same period in ~~2020.~~2021. The ~~decrease~~increase was a result of ~~cash deposits~~capital expenditures related to the ~~two buildings that were purchased on October 13, 2021, offset by the receipt~~construction of ~~$0.3 million held in escrow for the balance~~Phase I of the ~~outstanding Paycheck Protection Program.~~Kellyton Graphite Plant, which began construction related activities in December 2021. The ~~loan was officially forgiven~~capital expenditures in ~~full by~~ the ~~Small Business Administration~~first nine months of 2022 primarily related to earthwork and site grading, progress payments related to long-lead equipment items, work on ~~March 31, 2021,~~underground utilities and ~~the entire balance of the escrow fund was transferred to the Company.~~foundations, and detailed design engineering and project management activities.

Financing Activities

Net cash provided by financing activities was ~~$81.7~~$25.6 million for the nine months ended September 30, ~~2021,~~2022, due to sales of common stock through the Company’s ATM Offering ~~Agreement with Cantor and the Company’s December 2020 PA with Lincoln Park.~~Agreement. Net cash provided by financing activities for the same period in ~~2020~~2021 was ~~$13.9~~$81.7 million. The ~~$67.8~~$56.1 million ~~increase~~decrease was due to ~~greater shelf registration capacity with which to offer registered shares under the Company’s financing agreement with Cantor and increased~~lower sales activity under the ~~Company’s financing agreement with~~2020 Lincoln Park PA and the ATM Offering Agreement during the first nine months of ~~2021~~2022 compared to the same period in ~~2020.~~2021.

LIQUIDITY AND CAPITAL RESOURCES

The Company last recorded revenues from operations in 2009. Since 2009, the Company has relied on equity financings, debt financings and asset sales to fund its operations. The Company expects to rely on debt and equity financing to fund its operations and business plan for the foreseeable future.

~~Table of Contents~~

costs. The Company received approximately $1.8 million of enCore common stock and retained royalty interests on the New Mexico uranium properties as consideration for the sale. The Company retained its uranium interests in Turkey, which are subject to ongoing international arbitration proceedings, in which the Company is seeking damages.

During the first nine months of ~~2021,~~2022, the Company ~~focused on graphite process development~~continued construction activities ~~including operation of a pilot program for processing flake graphite into battery-grade graphite products~~related to the Kellyton Graphite Plant. Subject to global supply chain disruptions and ~~a DFS on~~challenges, and the Company’s ability to raise the remaining capital necessary to complete Phase I of the Kellyton Graphite Plant, the Company is targeting that it will begin testing and commissioning of Phase I of the Kellyton Graphite Plant in mid-year 2023 and expects the testing and commissioning to continue in the second half of 2023. Also during the first nine months of 2022, the Company continued its exploration project to investigate the size and extent of both graphite and vanadium mineral concentrations at the Coosa Graphite ~~Project. The data generated and experience gained from the pilot program was used to inform the Phase I DFS that~~Deposit. Drilling was completed in ~~October 2021~~April 2022 and ~~will also inform~~ the ~~requirements and specifications for building a commercial graphite processing facility.~~Company expects to complete the resource model by the end of the year 2022.

On September 30, ~~2021,~~2022, the Company’s cash balance was approximately ~~$119.0 million.~~$100.3 million inclusive of approximately 9.5 million Euros. The Company plans to use its Euro cash balance to pay for long lead equipment denominated in Euros. During the three and nine months ended September 30, ~~2021,~~2022, the Company sold ~~9.3~~0.8 million and 12.6 million shares of common stock for net proceeds of ~~$47.3~~$1.1 million ~~pursuant to its Controlled Equity Offering~~^SM ~~Sales Agreement with Cantor~~ and ~~6.1~~$25.6 million, ~~shares of common stock for net proceeds of $34.6 million~~respectively, pursuant to the ~~Lincoln Park December 2020 PA.~~ATM Offering Agreement. As of September 30, ~~2021,~~2022, the Company has ~~$50.0~~$21.2 million remaining available for future sales under the ATM Offering Agreement and has ~~9,700,252~~9.7 million shares of common stock available for future sales pursuant to the 2020 Lincoln Park ~~December 2020~~ PA.

Management believes the Company’s current cash balance is sufficient to fund its planned non-discretionary expenditures through ~~2022.~~the fourth quarter of 2023. The Company ~~anticipates~~has in place the ~~continued use of~~ATM Offering Agreement and the ~~Cantor and~~2020 Lincoln Park ~~financing facilities~~PA, both of which could be used to support construction of Phase I of the ~~commercial graphite processing facility.~~Kellyton Graphite Plant and the Company’s planned non-discretionary expenditures. While the Company has been successful in the past in raising funds through equity and debt financings as well as through the sale of non-core assets, no assurance can be given that additional financing will be available in amounts sufficient to meet its needs, or on terms acceptable to the Company. Stock price volatility, rising interest rates, inflation and generally uncertain economic conditions ~~caused by the COVID-19 pandemic, including the recent emergence of variant strains of the virus,~~ could significantly impact the Company’s ability to raise funds through equity or debt financing. ~~Market~~Further, market conditions, including but not limited to, inflation, labor shortages and supply chain disruptions could adversely impact the planned cost and the construction and commissioning timeline of Phase I of the ~~Company’s commercial graphite processing facility.~~ Kellyton Graphite Plant.

Along with evaluating the continued use of the ~~Cantor~~ATM Offering Agreement and the 2020 Lincoln Park ~~financing facilities,~~PA, the Company ~~may consider~~is considering other forms of project financing to fund the construction of the ~~Project.~~Kellyton Graphite Plant, including both Phase I and Phase II. The alternative sources of project financing could include, but are not limited to, project debt, convertible debt, or pursuing a partnership or joint venture. ~~In the event~~If funds are not available ~~for project financing~~ to ~~complete~~fund the construction of Phase I

Table of Contents

of the ~~Project in 2023,~~Kellyton Graphite Plant under the Company’s financing facilities or through alternative financing sources, the Company expects to be able to fund its non-discretionary expenditures with the Company’s current cash balance, however in such instance, the Company may be required to change its planned business development ~~strategies.~~strategies related to the Coosa Deposit and Phase I of the Kellyton Graphite Plant, including the construction and commissioning timeline of Phase I of the Kellyton Graphite Plant, or putting the construction of Phase I on hold until additional funding is obtained.

OFF-BALANCE SHEET ARRANGEMENTS

We have no off-balance sheet arrangements.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

With the exception of historical matters, the matters discussed in this report are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from projections or estimates contained herein. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, without limitation, statements regarding the adequacy of funding, liquidity, access to capital, financing activities, the timing or occurrence of any future drilling or production from the Company’s properties, ~~potential effects of the COVID-19 pandemic,~~economic conditions, the strategic goals of the business, arbitration matters, costs of Phase I of the ~~Project~~Kellyton Graphite Plant and estimated construction and commissioning timeline and completion date, ~~expected production quantities for Phase I~~the outcome of the ~~Project ,~~feasibility study and start date for the ~~realization~~mining of ~~expected benefits from recent business combinations~~the Coosa Graphite Deposit, and the Company’s anticipated cash burn rate and capital requirements. Words such as “may,” “could,” “should,” “would,” “believe,” “estimate,” “expect,” “anticipate,” “plan,” “forecast,” “potential,” “intend,” “continue,” ~~“project”~~“project,” “target” and variations of these words, comparable words and similar expressions generally indicate forward-looking statements. You are cautioned not to place undue reliance on forward-looking statements. Actual results may differ

~~Table of Contents~~

materially from those expressed or implied by these forward-looking statements. Factors that could cause actual results to differ materially from these forward-looking statements include, among others:

●

the spot price and long-term contract price of graphite (both flake graphite feedstock and purified graphite products) and vanadium, and the world-wide supply and demand of graphite and vanadium;

●

the effects, extent and timing of the entry of additional competition in the markets in which we operate;

●

~~the~~our ability to obtain contracts with customers;

●

available sources and transportation of graphite feedstock;

●

~~government regulation of the mining and processing industries in the United States;~~

●

~~our ability to maintain and timely receive mining and other permits from regulatory agencies;~~

●

the ability to control costs and avoid cost and schedule overruns during the development, construction and operation of the ~~Project;~~Kellyton Graphite Plant;

●

~~risks associated~~the ability to construct and operate the Kellyton Graphite Plant in accordance with ~~our operations~~the requirements of permits and licenses and the ~~operations~~requirements of ~~our partners,~~tax credits and other incentives;

●

the effects of inflation, including ~~the impact of COVID-19~~labor shortages and supply chain disruptions;

●

rising interest rates and the associated impact on the availability and cost of financing sources;

●

the availability and supply of equipment and materials needed to construct the Kellyton Graphite Plant;

●

stock price volatility;

●

government regulation of the mining and processing industries in the United States;

●

unanticipated geological, processing, regulatory and legal or other problems we may encounter;

Table of Contents

●

the results of our exploration activities, and the possibility that future exploration results may be materially less promising than initial exploration results;

●

any graphite or vanadium discoveries not being in high enough concentration to make it economic to extract the metals;

●

our ability to finance growth plans; ~~and~~

●

the potential effects of the continued COVID-19 pandemic;

●

currently pending or new litigation or ~~arbitration.~~arbitration; and

●

our ability to maintain and timely receive mining and other permits from regulatory agencies.

In addition, other factors are described in our Annual Report, ~~on Form 10-K for the year ended December 31, 2020,~~ and the other reports we file with the SEC. Most of these factors are beyond our ability to predict or control. Future events and actual results could differ materially from those set forth herein, contemplated by or underlying the forward-looking statements. Forward-looking statements speak only as of the date on which they are made. We disclaim any obligation to update any forward-looking statements made herein, except as required by law.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a smaller reporting company, we are not required to provide this information in our Quarterly Reports.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its filings with the Securities and Exchange Commission (“SEC”) is recorded, processed, summarized and reported within the time period specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls

~~Table of Contents~~

and procedures, management has recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply judgment in evaluating the Company’s controls and procedures.

During the fiscal period covered by this report, the Company’s management, with the participation of the Chief Executive Officer and Chief Financial Officer of the Company, carried out an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended). Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of September 30, ~~2021.~~2022.

Changes in Internal Controls

There were no changes in our internal control over financial reporting during the nine months ended September 30, ~~2021~~2022 that materially affected, or are reasonably likely to materially affect our internal control over financial reporting.

Table of Contents

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Information regarding reportable legal proceedings is contained in Part I, Item 3, “Legal Proceedings,” in our Annual ~~Report on Form 10-K for the year ended December 31, 2020.~~Report. There have been no material changes to the legal proceedings previously disclosed in the Annual ~~Report on Form 10-K, other than as set forth below.~~Report.

On December 13, 2018, Westwater filed a Request for Arbitration against the Republic of Turkey before the International Centre for the Settlement of Investment Disputes (“ICSID”), pursuant to the Treaty between the United States of America and the Republic of Turkey concerning the Reciprocal Encouragement and Protection of Investments. The Request for Arbitration was filed as a result of the Republic of Turkey’s unlawful actions against the Company’s licenses for the Temrezli and Sefaatli uranium projects owned by Westwater’s Turkish subsidiary Adur Madencilik Limited Sirketi (“Adur”). Specifically, in June 2018, the Turkish government cancelled all of Adur’s exploration and operating licenses with retroactive effect, rendering Westwater’s investment in Adur effectively worthless. While the Turkish authorities had variously issued, renewed and overseen these licenses for more than a decade, in June 2018 they asserted that those licenses were issued by mistake and that the Turkish government has a governmental monopoly over all uranium mining activities in Turkey, in violation of Westwater’s rights under both Turkish and international law. Westwater reached out on numerous occasions to the Turkish government to resolve this dispute amicably, to reinstate the licenses and to remedy Turkey’s unlawful actions, but to no avail.

As a result, on December 13, 2018, Westwater filed before ICSID its arbitration request against the Republic of Turkey. On December 21, 2018, ICSID registered Westwater’s Request for Arbitration. On May 1, 2019, the three-member ICSID Panel for the arbitration was established – one of the panel members was selected by Westwater, another was selected by Turkey, and the third panel member (serving as the Chair) was selected by the two party-appointed arbitrators. On September 9, 2019, the ICSID Panel issued Procedural Order #1, which places the locale for the proceeding in Washington, DC, and sets numerous dates for both parties to make various filings.

On January 27, 2020, Westwater filed its Memorial, which is a document that sets out Westwater’s case. On March 11, 2020, Turkey filed a request to bifurcate the arbitration proceeding, and on March 30, 2020, Westwater filed a response in opposition to Turkey's request for bifurcation. In Procedural Order #2 issued on April 28, 2020, the arbitral tribunal denied Turkey’s bifurcation request. On May 13, 2020, Turkey filed with the arbitral tribunal a request which Westwater elected not to oppose, to extend the date on which their Counter-Memorial must be filed (and to change dates for subsequent pleadings as well as document production and witness identification deadlines), which the arbitral tribunal approved on June 3, 2020. As a result of these decisions by the tribunal, Turkey filed its Counter-Memorial on September 14, 2020. Westwater filed its reply to the Counter-Memorial on March 17, 2021. The hearing on the substantive issues was conducted during the week of September 13-17, 2021. The Company does not expect a formal ruling on the matter until the second half of 2022.

~~Table of Contents~~

ITEM 1A. RISK FACTORS.

~~See RISK FACTORS~~An investment in our common stock involves various risks. When considering an investment in us, careful consideration should be given to the risk factors discussed in “Risk Factors” in Item 1A ~~of the Form 10-K for the year ended December 31, 2020 (“Form 10-K”) for a discussion of the risk factors of the Company. Except as described below, there have been~~in our Annual Report. There are no material changes to ~~these~~the risk factors ~~from those previously disclosed~~described in ~~the Form 10-K.~~our Annual Report, except as follows:

Our business could be negatively impacted by inflationary pressures, which may result in increased costs of operations and negatively impact the securities markets generally, which could have a material adverse effect on our ability to access capital.

The ~~Company~~U.S. has experienced rising inflation in 2022 and U.S. inflation is currently at a 40-year high. A sustained increase in inflation may ~~incur unexpected~~continue to raise our costs ~~or delays in~~for labor, services, and materials. Further, our suppliers face inflationary impacts such as the ~~construction of~~tight labor market and supply chain disruptions, that could increase the costs to construct and commission the Kellyton Graphite Plant, explore and develop the Coosa Graphite ~~Project production facility.~~Deposit, and our day to day operations. The rate and scope of these various inflationary factors may increase our operating costs materially, which may not be readily recoverable, and have an adverse effect on our costs, operating margins, results of operations and financial condition.

~~The Company is~~Further, sustained inflation has caused and may continue to cause the Federal Reserve Board to raise the target for the federal funds rate, which correspondingly increases interest rates. Increased interest rates could have a negative effect on the securities markets generally which may, in turn, have a material adverse effect on the Company’s ability to access capital, particularly debt financing, and the market price of equity securities, including the Company’s common stock, which usually decrease as interest rates rise. To the extent that we access debt financing or issue variable interest rate instruments in the ~~process~~future, any increase in interest rates would increase our cost of ~~developing~~borrowing and anticipates commencing construction of the Coosa Graphite Project’s production facility in the fourth quarter 2021. The completion of the Coosa Graphite Project’s production facility without delays or significant cost overruns involves substantial risks that may occur, including the accuracy of the estimates and findings in the Definitive Feasibility Study; successful negotiation of construction contracts; challenges with managing contractors and vendors; subcontractor performance; adverse weather conditions and natural disasters; contractor and/or vendor delays; increased costs, shortages, or inconsistent quality of equipment, materials, and labor; delays due to judicial or regulatory action; nonperformance under construction or other agreements; engineering or design problems; negative impacts of the COVID-19 pandemic or future pandemic health events; work stoppages; continued public and policymaker support for the project; environmental and geological conditions; and challenges with start-up activities and operational performance. Additionally, the Coosa Graphite Project’s production facility includes the Company’s improved method for purification of graphite concentrate and is a design process that has not previously been constructed.our interest expense.

We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability, an ongoing military conflict between Russia and Ukraine, and record inflation. Our business, financial condition and results of operations could be materially adversely affected by any negative impact on the global economy and capital markets resulting from the conflict in Ukraine, geopolitical tensions, or record inflation.

In February of 2022, Russian military forces invaded Ukraine, and sustained conflict and disruption in the region is likely. Although the length, impact and outcome of the ongoing military conflict in Ukraine is highly unpredictable, this conflict could lead to significant market and other disruptions, including significant volatility in commodity prices and supply of energy resources, instability in financial markets, higher inflation, supply chain interruptions, political and social instability, changes in consumer or purchaser preferences as well as increase in cyberattacks and espionage. We are continuing to monitor the conflict and assessing its potential impact on our business.

The extent and duration of the military action or future escalation of such hostilities, the extent and impact of existing and future sanctions, market disruptions and volatility, and the result of any diplomatic negotiations cannot be predicted. While we expect any direct impacts to our business to be limited, the indirect impacts on the economy and on the mining industry and other industries in general could negatively affect our business and may make it more difficult for us to raise equity or debt financing. In addition, the impact of other current macro-economic factors on our business, which may be exacerbated by the war in Ukraine - including inflation, supply chain constraints and geopolitical events - is likely to have an adverse effect on our business

Table of Contents

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

~~None~~

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

~~None.~~

ITEM 4. MINE SAFETY DISCLOSURES.

~~Not applicable.~~

ITEM 5. OTHER INFORMATION.

~~None.~~

Table of Contents

ITEM 6. EXHIBITS.


Exhibit Number		Description
3.1		Restated Certificate of Incorporation of the Company, as amended through April 22, 2019 (incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2019).

~~10.1~~3.2		~~Westwater Resources, Inc. 2013 Omnibus Incentive Plan,~~Amended and Restated Bylaws of the Company, as amended August 21, 2017 (incorporated by reference to ~~Appendix B~~Exhibit 3.2 to the Company’s ~~Definitive Proxy Statement~~Quarterly Report on ~~Schedule 14A~~Form 10-Q for the quarterly period ended September 30, 2017).

10.1*		Employment Agreement, effective August 26, 2022, between the Company and Steven M. Cates (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on ~~March~~June 20, 2022)

10.2*		Agreement and Release, effective August 26, ~~2021).~~2022, between the Company and Jeffrey L. Vigil (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on June 20, 2022)

31.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

~~Table of Contents~~

101.INS:		Inline XBRL Instance Document

101.SCH:		Inline XBRL Taxonomy Extension Schema Document

101.CAL:		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF:		Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB:		Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE:		XBRL Taxonomy Extension Presentation Linkbase Document

~~101.PRE:~~		~~XBRL Taxonomy Extension Presentation Linkbase Document~~

104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

* Indicates management contract or compensatory plan or arrangement.

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	WESTWATER RESOURCES, INC.

Dated: November ~~10, 2021~~9, 2022	By:	/s/ ~~Christopher~~Chad M. ~~Jones~~Potter
		~~Christopher~~Chad M. ~~Jones~~Potter
		President and Chief Executive Officer (Principal Executive Officer)

Dated: November ~~10, 2021~~9, 2022	By:	/s/ ~~Jeffrey L. Vigil~~Steven M. Cates
		~~Jeffrey L. Vigil~~Steven M. Cates
		Vice President - Finance and Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)

2926


	As of September 30,
(thousands of dollars)	2021		2020
Cash and cash equivalents	$	118,969	$	5,480
Restricted cash - pledged deposits for performance bonds		—		3,807
Cash, cash equivalents and restricted cash shown in the statement of cash flows	$	118,969	$	9,287


	September 30, 2021
(thousands of dollars)	Level 1		Level 2		Level 3		Total
Current Assets
Equity securities	$	3,438	$	—	$	—	$	3,438
Land grant		—		—		1,378		1,378
Total current assets recorded at fair value	$	3,438	$	—	$	1,378	$	4,816


	December 31, 2020
(thousands of dollars)	Level 1		Level 2		Level 3		Total
Current Assets
Equity securities	$	—	$	—	$	1,520	$	1,520
Total current assets recorded at fair value	$	—	$	—	$	1,520	$	1,520
Non-current Assets
Restricted cash	$	10	$	—		—	$	10
Total non-current assets recorded at fair value	$	10	$	—	$	—	$	10